According to a press release published earlier this week, the Massachusetts Cannabis Control Commission approved Cannabis Trainers as one of the state’s first vendor training providers. The training program, Sell-SMaRT™ is the world’s first state-approved cannabis vendor training.
Regulations in Massachusetts require all licensed growers, managers and employees that handle cannabis to take a responsible vendor training class through a certified provider by January 1, 2020.
The Sell-SMaRT™ program was originally developed for licensees handling cannabis in Colorado. In 2015, Colorado regulators granted the program the first ever certification for its Responsible Vendor Program in cannabis. Since then, almost 4,000 people have taken the Cannabis Trainers class, which has been customized for six states, including Massachusetts.
Maureen McNamara, founder of Cannabis Trainers, built on two decades of experience in alcohol vendor training before she started the training program for cannabis. “Massachusetts is really setting a new standard with its training requirements,” says McNamara. “We’ve worked hard to customize the Sell-SMaRT™ program for the state’s needs, and we appreciate the Cannabis Control Commission’s recognition of that. We’re excited to help inspire a cannabis workforce in the state that is responsible, compliant and committed to excellence.”
Meg Sanders, CEO of Canna Provisions, a Massachusetts cannabis company, says the program helps her employees learn the rules thoroughly. “Cannabis Trainers trained all of my Colorado employees, and my entire team in Massachusetts as well,” says Sanders. “I know every time Cannabis Trainers meets with my staff, we walk away smarter and better prepared to help our customers.”
On July 18, 2019, the Riverside County Sheriff’s Department in California served search warrants at 56 illegal cannabis cultivation sites. This operation was spearheaded by 390 law enforcement personnel, whose mission was to combat the ongoing problem of illegal cannabis cultivation sites throughout California.
The raids resulted in:
47,939 marijuana plants confiscated
2,132 pounds of processed cannabis
47 tons of cannabis plants disposed
2 Butane Honey Oil Labs located
The target of the operation was illegal cultivation sites. Individuals or licensed businesses with permits to grow cannabis legally were not affected.
Illegal cultivation is far from just a California problem. For example, if Oregon halted cannabis production today, the state would not experience a shortage as it has a six-year surplus.
The fear for investors and legal growers is that, if some growers turn to the black market to unload excess inventory, federal enforcement will come into play, which will set back the legal cannabis industry to the stone age. Oregon is currently making moves to limit licensure for legal production, but some active licenses may also need to be revoked, which would leave those licensees with vast investment losses. In other words, legalized cannabis’s massive economic market is not without financial problems of its own.
Don’t Make a Federal Case Out of It
Several states have legalized recreational cannabis with the intention of reimagining this vast underground market as an above-board business that bolsters the state’s economy via transparent dealings. To date, however, the federal government has refused to budge regarding cannabis’s status as an illegal Schedule 1 substance. This classification puts cannabis on a par with opioids. As such, those states that have legalized recreational cannabis are extremely motivated to keep these businesses on the up and up and not to pique federal interest.
Black Market Vulnerability
One of the tenets of legalizing cannabis is stemming the proliferation of black-market suppliers and minimizing the negative effects that the “war on drugs”has had in minority communities. These positive impetuses have yet to flourish. As a result of the illegal status of cannabis at the federal level, cannabis-legal states are forced to operate as islands.
Generally, taking legally purchased cannabis across state lines – from a legal to an illegal state – is illegal, and this is not only confusing but is also a recipe for complications. This leaves cannabis-legal states vulnerable to black market activity. These pockets of legal recreational cannabis that are popping up around the country loosen the constraints of the cannabis movement while the legality of this movement remains problematic. The results are an environment that’s extremely hospitable to black market activity.
Supply and Demand
The reality is that – due to supply and demand – cannabis costs about half as much in cannabis-legal states as it does in states in which it’s illegal. Black market growers in legal states destabilize the market. Those legit companies which remain above board, pay their taxes and jump through every legal hoop, cannot compete with black market interlopers who eschew such niceties.
The point made by detractors of legal cannabis isn’t lost on the rest of us – the black market is burgeoning.States that have legalized production have inadvertently made it easier for illegal producers to hide in plain sight, and the line between legal and illegal operations can become blurred. This creates new frustrations for law enforcement and naturally cuts into the legal cannabis trade. The situation has left some opponents to legalization demanding new crackdowns – others characterize such suggestions as amounting to a new war on drugs.
No Going Back
Detractors of legalized cannabis claim the somewhat chaotic effects related to the current patchwork approach to legalization are a result of opening the gates to legalization in the first place. However, putting the genie of legalized recreational cannabis back in the bottle simply isn’t feasible for operational, financial and political reasons. With the proliferation of attendant illegal operations, however, it is becoming more and more clear that leveling the playing field – via some form of federal legalization – is inevitable. The current state-by-state solution leaves too much wiggle room for the illegal transport of cannabis from those states with looser restrictions to those states with tighter protocols. If politics is choosing between the disastrous and the unpalatable, the billion-dollar cannabis conundrum is a great example. The question may no longer be should we legalize cannabis but, instead, how do we legalize cannabis.In other words, we need to find a path forward, and focusing only on the pitfalls that we’ve experienced so far isn’t going to get us where we need to be.
A Tale of Two Choices
The point made by detractors of legal cannabis isn’t lost on the rest of us – the black market is burgeoning. As such, we have an important decision to make. A blanket prohibition of cannabis may no longer be practicable, so we’re left to choose between legal and overt practices across the board or a hodgepodge of semilegal practices with covert ops in tow. Fostering illegal activity is rarely in our nation’s best interests, which leaves legalizing cannabis at the federal level as possibly the most practicable solution.
Protecting Public Health
As more states embrace the legalization of recreational cannabis, public health concerns remain an issue. Many of these illegal cultivators use chemicals that are banned in the United States and do not properly dispose of chemicals or waste products that destroy the environment, contaminate drinking water and have the potential to harm or even kill residents and domestic animals. Not only is this activity harmful, growers often steal electricity and water from surrounding residents.
Cobbling together a pastiche of laws, however, inevitably bolsters black market activity and does nothing to help protect public health. Even the staunchest proponents of legalizing cannabis don’t want minors involved in the equation. Additionally, few debate that unchecked usage is a healthy option. Quasi-legislation at the state level (and on a state-by-state basis), however, provides neither a check nor a balance.
Onward and Upward
The most likely next step for safeguarding public health, for stemming black-market activity, and for generating maximum revenues is toward thoughtful and comprehensive national legalization that comes sooner rather than later. In the meantime, law enforcement should protect the public, legal operations, investors, and the environment from the black market.
The opinions expressed are those of the author and do not necessarily reflect the views of Guidepost Solutions or its clients.
Europe saw big developments on the cannabis front all year. This includes country-by-country developments that include legalization of medical use and even plans to begin domestic production, no matter how delayed such plans have turned out to be.
By far the most interesting market developments were in Germany all year. The Teutonic state has entered some interesting territory – even if its potential is still in the development rather than rollout status.
Elsewhere, however, medical acceptance is clearly starting to bloom across the continent in a way that is more reminiscent of American state development than what is about to happen in Canada.
One of the most interesting aspects of European reform however, that is in marked difference to what has happened in the U.S., is that grow facilities are being slowly established with federal authorization, even before further reform comes (see Turkey, Slovenia, Germany and even Denmark).
How reform will continue to roll out and shape the discussion however, is still a matter very much left up to individual European states. Cannabis legalization may become the first uniting issue of the new Deutsch ruling parliamentary coalition, whatever that is. In Spain, the cannabis question might yet be a play in simmering separatist tensions. Across the continent, legislatures are, for the first time in two generations, reconsidering what cannabis is, how it should be used, and what the penalties should be for those who use the drug either medicinally or recreationally.
Change is still all over the map. And it is still very, very slow.
The country’s federal legislators voted unanimously to mandate medical coverage of cannabis under public health insurance (which covers 90% of the population) on January 19th. Since then, however, forward movement has been stymied by a combination of forces and politics. While the legislation became law in March and the government established a cannabis agency, other developments have not been so clear cut. Yes, import licenses are being issued. And yes, there is a pending tender bid. However announcements of the finalists have been delayed since August due to lawsuits over qualifications of the growers, among other things. The new German government (whatever it will be) plus apparent CETA (EU-Canada Comprehensive Economic and Trade Agreement)-related complications have all added to the drama. That said, when the cannabis opera moves into its next act, as of probably early next year, expect to see domestic medical grow go forward. Importing medical supplies, even from across the continent (which is what is happening now) is ludicrously expensive. Rumours are already flying out of Berlin that further cannabis reform is one of the few things that all parties can agree to as a new government forms.
Sadly, the biggest cannabis-related “development” this year was the decision by all major health insurers to stop covering the drug, just as the German government changed its mind about the issue. Greater regulation of coffee shop grows coupled with this lack of insurance coverage means that patients are being forced into a coffee shop culture which is also commoditizing and commercializing into a high-volume affair, particularly in Amsterdam. While this might just be the new face of an old business, the laid back “coffee shop” culture of yore is an endangered species.
Catalonian independence made headlines globally this year. So did the associated bid for other freedoms of a cannabis sort – particularly in Barcelona. Club grows were set to become more regulated as of this summer. However the massive Catalonian bid for independence has further muddied the waters. Given the fact that cannabis reform appears to be at the forefront of finding political compromise elsewhere in Germany, perhaps givebacks about taxes for this industry might be one way to temper down the still-raging separatist forces afoot.
The Polish government surprised everyone this fall, and legalized the drug for medical purposes (at least in theory) in November. What this actually means for patients is another story. There are no plans to cultivate on the radar. Patients under the new law are allowed to travel to other countries to seek their medical cannabis. How they might afford it is another question. Not to mention how they will escape prosecution from personal importation if checked at a border.
Polish pharmacists will however be trained on how to make medicaments from imported cannabis. They will have to be registered with the Office for the Registration of Medical Products. This means that pharmacists must be pre-registered with the government – in a move much like the early days of the Israeli medical program. The medicine is expected to cost about $460 a month. How well this will work in serving the country’s more than 300,000 already eligible patients is another story.
Cannabis economists have long said that what the Greeks really need to heal their economy is a vibrant cannabis injection. And as of mid-November early investors in the nascent market had already staked close to $2 billion in cultivation opportunities. Senior ministers in the government have also publicly backed plans to move Greece into a strategic position to claim a piece of a global cannabis market estimated to reach 200 billion dollars a year by the end of the next decade. It means jobs. It means capital infusions. Exactly, in other words, what the Greek economy desperately needs. Expect to see further formalization of the grow program here in 2018 for sure.
It appears that quite a few countries in Europe are pushing for real cannabis reform by the end of the year, and this little EU country is joining the list. With a unanimous agreement in Parliament already to change the country’s drug policy, Lithuania’s legislators could vote to legalize the drug on December 12th of this year. All signs look promising.
MCG, an Australian-based company, made news in the fall by announcing a new cannabinoid extraction facility in the country, on track for completion this year. The company also ramped up domestic production operations in August. Real reform here still has a long way to go. However with domestic production underway, greater medical use looks promising.
The country signed a production agreement to open a new facility in Odense, the country’s third largest city with Spektrum Cannabis, the medical brand of one of the largest Canadian producers (Canopy Cannabis) now seeking a foothold in Europe late this fall. What this means for ongoing reform in Denmark is also positive. The company will import cannabis via Spektrum Denmark until all the necessary approvals are ironed out for cultivation.
While “reform” here is less of an issue than it is elsewhere (since all drugs are decriminalized), Portugal might yet play an interesting role in cross-European legalization. Tilray, another large Canadian-American firm with interests in Europe, announced the construction of a large medical cannabis facility in the country earlier this year. That plant could easily ship medical supplies across Europe as new countries legalize but do not implement grow facilities.
As the cannabis marketplace evolves, so does the technology. Cultivators are scaling up their production and commercial-scale operations are focusing more on quality. That greater attention to detail is leading growers, extractors and infused product manufacturers to use analytical chemistry as a quality control tool.
Previously, using analytical instrumentation, like mass spectrometry (MS) or gas chromatography (GC), required experience in the laboratory or with chromatography, a degree in chemistry or a deep understanding of analytical chemistry. This leaves the testing component to those that are competent enough and scientifically capable to use these complex instruments, like laboratory personnel, and that is still the case. As recent as less than two years ago, we began seeing instrument manufacturers making marketing claims that their instrument requires no experience in chromatography.
Instrument manufacturers are now competing in a new market: the instrument designed for quality assurance in the field. These instruments are more compact, lighter and easier to use than their counterparts in the lab. While they are no replacement for an accredited laboratory, manufacturers promise these instruments can give growers an accurate estimate for cannabinoid percentages. Let’s take a look at a few of these instruments designed and marketed for quality assurance in the field, specifically for cannabis producers.
Ellutia GC 200 Series
Ellutia is an instrument manufacturer from the UK. They design and produce a range of gas chromatographs, GC accessories, software and consumables, most of which are designed for use in a laboratory. Andrew James, marketing director at Ellutia, says their instrument targeting this segment was originally designed for educational purposes. “The GC is compact in size and lightweight in stature with a full range of detectors,” says James. “This means not only is it portable and easy to access but also easy to use, which is why it was initially intended for the education market.”
That original design for use in teaching, James says, is why cannabis producers might find it so user-friendly. “It offers equivalent performance to other GC’s meaning we can easily replace other GC’s performing the same analysis, but our customers can benefit from the lower space requirement, reduced energy bills, service costs and initial capital outlay,” says James. “This ensures the lowest possible cost of ownership, decreasing the cost per analysis and increasing profits on every sample analyzed.”
Shamanics, a cannabis oil extraction company based in Amsterdam, uses Ellutia’s 200 series for quality assurance in their products. According to Bart Roelfsema, co-founder of Shamanics, they have experienced a range of improvements in monitoring quality since they started using the 200 series. “It is very liberating to actually see what you are doing,” says Roelfsema. “If you are a grower, a manufacturer or a seller, it is always reassuring to see what you have and prove or improve on your quality.” Although testing isn’t commonplace in the Netherlands quite yet, the consumer demand is rising for tested products. “We also conduct terpene analysis and cannabinoid acid analysis,” says Roelfsema. “This is a very important aspect of the GC as now it is possible to methylate the sample and test for acids; and the 200 Series is very accurate, which is a huge benefit.” Roelfsema says being able to judge quality product and then relay that information to retail is helping them grow their business and stay ahead of the curve.
908 Devices G908 GC-HPMS
908 Devices, headquartered in Boston, is making a big splash in this new market with their modular G908 GC-HPMS. The company says they are “democratizing chemical analysis by way of mass spectrometry,” with their G908 device. That is a bold claim, but rather appropriate, given that MS used to be reserved strictly for the lab environment. According to Graham Shelver, Ph.D., commercial leader for Applied Markets at 908 Devices Inc., their company is making GC-HPMS readily available to users wanting to test cannabis products, who do not need to be trained analytical chemists.
Shelver says they have made the hardware modular, letting the user service the device themselves. This, accompanied by simplified software, means you don’t need a Ph.D. to use it. “The “analyzer in a box” design philosophy behind the G908 GC-HPMS and the accompanying JetStream software has been to make using the entire system as straightforward as possible so that routine tasks such as mass axis calibration are reduced to simple single actions and sample injection to results reporting becomes a single button software operation,” says Shelver.
He also says while it is designed for use in the field, laboratories also use it to meet higher-than-usual demand. Both RM3 Labs in Colorado, and ProVerde in Massachusetts, use G908. “RM3’s main goal with the G908 is increased throughput and ProVerde has found it useful in adding an orthogonal and very rapid technique (GC-HPMS) to their suite of cannabis testing instruments,” says Shelver.
Orange Photonics LightLab Cannabis Analyzer
Dylan Wilks, a third generation spectroscopist, launched Orange Photonics with his team to produce analytical tools that are easy to use and can make data accessible where it has been historically absent, such as onsite testing within the cannabis space. According to Stephanie McArdle, president of Orange Photonics, the LightLab Cannabis Analyzer is based on the same principles as HPLC technology, combining liquid chromatography with spectroscopy. Unlike an HPLC however, LightLab is rugged, portable and they claim you do not need to be a chemist to use it.
“LightLab was developed to deliver accurate repeatable results for six primary cannabinoids, D9THC, THC-A, CBD, CBD-A, CBG-A and CBN,” says McArdle. “The sample prep is straightforward: Prepare a homogenous, representative sample, place a measured portion in the provided vial, introduce extraction solvent, input the sample into LightLab and eight minutes later you will have your potency information.” She says their goal is to ensure producers can get lab-grade results.
McArdle also says the device is designed to test a wide range of samples, allowing growers, processors and infused product manufacturers to use it for quality assurance. “Extracts manufacturers use LightLab to limit loss- they accurately value trim purchases on the spot, they test throughout their extraction process including tests on spent material (raffinate) and of course the final product,” says McArdle. “Edibles manufacturers test the potency of their raw ingredients and check batch dosing. Cultivators use LightLab for strain selection, maturation monitoring, harvesting at peak and tinkering.”
Orange Photonics’ instrument also connects to devices via Wi-Fi and Bluetooth. McArdle says cannabis companies throughout the supply chain use it. “We aren’t trying to replace lab testing, but anyone making a cannabis product is shooting in the dark if they don’t have access to real time data about potency,” says McArdle.
Last week, Pennsylvania Department of Health Secretary Dr. Karen Murphy announced the formation of temporary regulations for cannabis growers and processors in the state, according to a press release. Those temporary rules were published on Saturday, October 29. Secretary Murphy asked for public comment on developing regulations for dispensaries as well.
The PA Department of Health published the new set of temporary regulations this past Saturday, outlining “the financial, legal and operational requirements needed by an individual to be considered for a grower/processor permit, as well as where the facilities can be located.” The regulations also discuss tracking systems, equipment maintenance, safety issues, disposal of cannabis, tax reporting, pesticides, recalls and insurance requirements. “One of our biggest accomplishments to date is the development of temporary regulations for marijuana growers and processors,” says Secretary Murphy. “We received nearly 1,000 comments from members of the community, the industry and our legislative partners.”
The general provisions published on Saturday outline the details of the application process, fees, inspections, reporting, advertising and issues surrounding locations and zoning. The temporary regulations for growers and processors delve into the minutia of regulatory compliance for a variety of issues: including security, storage, maintenance, transportation, tracking, disposal, recall, pesticides and packaging and safety requirements. A list of pesticides permitted for use can also be found at the bottom of the rules.
The document discusses the regulations for performing voluntary and mandatory recalls in great detail. It requires thorough documentation and standard operating procedures for the disposal of contaminated products, cooperation with the Department of Health and appropriate communications with those affected by the recall.
The department has yet to release temporary regulations for laboratories and dispensaries, but hopes to do so before the end of the year. “I am encouraging the public – and specifically the dispensary community – to review the temporary regulations and provide us with their feedback,” says Secretary Murphy. “The final temporary regulations for dispensaries will be published in the Pennsylvania Bulletin by the end of the year.”
Since Governor Tom Wolf signed the medical cannabis program bill into law in April 2016, the state has made considerable progress to develop the program, including setting up a physician workgroup, public surveys for developing temporary rules and a request for information for electronic tracking IT solutions. The PA Department of Health expects to implement the program fully in the next 18 to 24 months.
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